Money, Banking, and Financial
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Book Preface
Sample Chapter
Feature Summary
What's New
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Student Edition
Instructor Edition
Money, Banking, and Financial Markets, 4/e

Stephen G. Cecchetti, Bank for Intl. Settlements, Brandeis University
Kermit L. Schoenholtz, Stern School of Business, New York University

ISBN: 007802174x
Copyright year: 2015

What's New

  • New! Integration with FRED – the free, online database created and maintained by the Federal Reserve Bank of St. Louis for use by everyone—professionals, students, and the general public. FRED covers about 200 countries with nearly 150,000 economic time series from about 50 data producers. FRED’s economic data is updated daily. Understanding this type of data us critical to understanding money and banking. FRED is integrated in many ways in this edition:

    • Data Exploration Problems in the end-of-chapter material provide students with problems to solve using the FRED website. Hints on solving these problems are provided on the text’s website, or by scanning the bar code next to the set of problems.

    • FRED data is used in exhibits throughout the chapters.

    • FRED data codes tables appear at the end of the chapters and list key economic and financial indicators relevant to the chapter.

    • Appendix B to Chapter 1 and the Online Learning Center at have additional resources for using FRED.

  • New Topics in the Integrated Global Perspective. The Fourth Edition has been revised extensively in light of the regulatory and monetary policy developments in the aftermath of the global financial crisis, and as a result of the euro-area crisis that began in 2010. Throughout the Fourth Edition, the authors have integrated key developments and relevant insights from these experiences. New topics introduced or discussed in much greater detail include:

    • Shadow banking

    • Systemic risk

    • Too big to fail

    • Unconventional monetary policy tools

    • The euro-area crisis

    • The Dodd-Frank financial reform legislation

    • Basel III regulatory changes

    • Central bank communications

  • Changes at the Federal Reserve. The discussion of the Federal Reserve now highlights the introduction of a numerical inflation objective and the evolving communications strategy (Chapter 16), the use of unconventional policy tools in addressing the financial crisis (Chapter 18), and the impairment of the monetary transmission process during the crisis (Chapter 23). It also reflects the challenge to Fed independence in the aftermath of the crisis (Chapter 15).

  • Learning Objectives. Learning objectives are now introduced at the beginning of each chapter to highlight the concepts to be mastered. They are referenced again among the end of chapter problems to which they relate.

  • Updated Coverage of Global Events. New and updated learning tools present timely and relevant topics and events to further enhance the material. A complete list of the new features (including those with major updates) include:

    • Lessons from the Crisis

      Interbank Lending (Chapter 3)

      The ECB and the Crisis of the Euro Area (Chapter 16)

      Oasis of Stability (Chapter 19)

    • In the News

      Airtime is Money: The Other Type of Mobile Money (Chapter 2)

      High-Frequency Trading: Wait a Second (Chapter 3)

      Risk-on, Risk-off May Be Ending (Chapter 5)

      Gross’s Burning Bond Market Fails to Frighten Investors (Chapter 6)

      Bubble Spotting (Chapter 8)

      No Insurance Pay-Out on Greek Debt (Chapter 9)

      Foreign Exchange: Neighbors Show Little Appetite for Brazil’s “War” (Chapter 10)

      China Shadow Bankers Go Online as Peer-to-Peer Sites Boom (Chapter 11)

      Lessons from the London Whale (Chapter 12)

      Fed’s Tarullo Says Reviving Glass-Steagall May Be Costly (Chapter 13)

      How to Shrink the “Too-Big-to-Fail” Banks (Chapter 14)

      The Politicization (or Not) of Central Banks (Chapter 15)

      Should the Fed Change Its Target? An Interview with Michael Woodford (Chapter 16)

      The Monetary Base Is Exploding. So What? (Chapter 17)

      How Jawboning Works (Chapter 18)

      Phony Currency Wars (Chapter 19)

      Will Fed’s “Easy Money” Push Up Prices? (Chapter 20)

      Yellen Says Higher Rates Not Assured After Thresholds Hit (Chapter 21)

      Potential Output: Rising Permanent Damage (Chapter 22)

      Should the Fed Pop Bubbles by Raising Interest Rates? (Chapter 23)

    • Applying the Concept

      The Tri-Party Repo Market (Chapter 12)

      The LIBOR Scandal (Chapter 13)

    • Tools of the Trade

      The Basel Accords: I, II, III, and Counting… (Chapter 14)

Instructors: To experience this product firsthand, contact your McGraw-Hill Education Learning Technology Specialist.